Company Update January 2022
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Company Update
January 2022
Important Information
FORWARD-LOOKING STATEMENTS: All statements in this presentation, other than statements of historical fact, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All forward-looking statements speak only as of the date of this presentation. These forward-looking statements involve known and unknown risks and uncertainties,
which may cause Public Storage’s actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Factors and risks that may impact future results and
performance are described from time to time in Public Storage’s filings with the Securities and Exchange Commission, including in Item 1A, “Risk Factors” in Public Storage’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2020 and our subsequent Quarterly Reports on Form 10-Q and current reports on Form 8-K. These risks include, but are not limited to, the following: general risks associated with the ownership and
operation of real estate, including changes in demand, risk related to development, expansion and acquisition of self-storage facilities, potential liability for environmental contamination, natural disasters and adverse
changes in laws and regulations governing property tax, real estate and zoning; risks associated with downturns in the national and local economies in the markets in which we operate, including risks related to current
economic conditions and the economic health of our customers; risks associated with the COVID-19 Pandemic (the "COVID Pandemic”) or similar events, including but not limited to illness or death of our employees or
customers, negative impacts to the economic environment and to self-storage customers which could reduce the demand for self-storage or reduce our ability to collect rent, and/or potential regulatory actions to (i) close
our facilities if we were determined not to be an “essential business” or for other reasons, (ii) limit our ability to increase rent or otherwise limit the rent we can charge or (iii) limit our ability to collect rent or evict delinquent
tenants; the risk that there could be an out-migration of population from certain high-cost major markets, if it is determined that the ability to “work from home,” which has become more prominent during the COVID
Pandemic, could allow certain workers to live in less expensive localities, which could negatively impact the occupancies and revenues of our properties in such major high-cost markets; the risk that more jurisdictions will
reinstitute COVID Pandemic restrictions, which were previously eased, in response to increases in infections, including as a result of variants such as the Delta variant, or if additional pandemics occur; the risk that we could
experience a change in the move-out patterns of our long-term customers due to economic uncertainty and the increases in unemployment resulting from changes in the macro environment, which could lead to lower
occupancies and rent “roll down” as long-term customers are replaced with new customers at lower rates; risk of negative impacts on the cost and availability of debt and equity capital as a result of the COVID Pandemic,
which could have a material impact upon our capital and growth plans; the impact of competition from new and existing self-storage and commercial facilities and other storage alternatives; the risk that our existing self-
storage facilities may be at a disadvantage in competing with newly developed facilities with more visual and customer appeal; risks related to increased reliance on Google and Sparefoot as customer acquisition channels;
difficulties in our ability to successfully evaluate, finance, integrate into our existing operations and manage properties that we acquire directly or through the acquisition of entities that own and operate self-storage
facilities or to consummate announced acquisitions in the expected timeframe or at all; risks associated with international operations including, but not limited to, unfavorable foreign currency rate fluctuations, changes in
tax laws and local and global economic uncertainty that could adversely affect our earnings and cash flows; risks related to our participation in joint ventures; the impact of the legal and regulatory environment, as well as
national, state and local laws and regulations including, without limitation, those governing environmental issues, taxes, our tenant reinsurance business, and labor, including risks related to the impact of new laws and
regulations; risks of increased tax expense associated either with a possible failure by us to qualify as a REIT, or with challenges to the determination of taxable income for our taxable REIT subsidiaries; risks due to ballot
initiatives or other actions that could remove the protections of Proposition 13 with respect to our real estate and result in substantial increases in our assessed values and property tax bills in California; changes in United
States federal or state tax laws related to the taxation of REITs and other corporations; security breaches, including ransomware, or a failure of our networks, systems or technology could adversely impact our operations or
our business, customer and employee relationships or result in fraudulent payments; risks associated with the self-insurance of certain business risks, including property and casualty insurance, employee health insurance
and workers compensation liabilities; difficulties in raising capital at a reasonable cost; delays and cost overruns on our projects to develop new facilities or expand our existing facilities; difficulties in our ability to hire and
retain skilled management and staff; ineffective succession planning for our CEO, executive management and our other key employees; ongoing litigation and other legal and regulatory actions which may divert
management’s time and attention, require us to pay damages and expenses or restrict the operation of our business; and economic uncertainty due to the impact of war or terrorism. Public Storage disclaims any obligation
to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, new estimates, or other factors, events or circumstances after the date of this presentation, except where
required by law.
NON-GAAP MEASURES: This presentation contains non-GAAP measures, including FFO and NOI. Non-GAAP measures should not be considered as an alternative to, or more meaningful than, net income (determined in
accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and is not an alternative to, or more meaningful than, cash flow from operating activities (determined in accordance with
GAAP) as a measure of liquidity. Non-GAAP measures have limitations as they do not include all items of income and expense that affect operations and, accordingly, should always be considered as supplemental
financial results to those presented in accordance with GAAP. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful. Please refer to our SEC periodic reports
for definitions of our non-GAAP measures and reconciliations to the nearest GAAP measures.
2
Company Highlights
I. Self-Storage Industry Leader
II. Innovation-Powered Organic Growth
III. Multi-Factor External Growth
IV. Growth-Oriented Balance Sheet
V. Attractive Valuation and Outlook
Appendix: 4Q21 Operating Update
Note: This presentation complements our 2021 Investor Day presentation,
which is available in the Investor Relations section of PublicStorage.com
3
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
The Self-Storage Industry Leader
NYSE / S&P 500 2,700+
company owned properties
50 198M
years in operation owned rentable square feet
A / A2 39
credit rating (S&P/Moody’s) states
$3.0B 1.8
LTM revenues million customers in place
$2.2B 22%
LTM net operating portfolio expansion through
income (NOI) $7.1 billion of investment
over the past three years
Source: Company filings and data
Note: As of 9/30/21 unless otherwise noted. Properties, square footage, states, and customers in place include acquisition properties closed or under contract subsequent to 9/30/21. 4
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Unique Competitive Advantages
High-Integrity Team & Culture
An innovation-driven culture
with broad diversity
Unmatched Scale & Locations Multi-Lever External Growth
Half of the U.S. population lives Acquisition, development, and redevelopment
within a Public Storage trade area expertise drives value creation
Platform Strength & Innovation Growth-Oriented Balance Sheet
Iconic Brand
Continuous first-mover strategy, technology, and Capacity to fund
platform innovation with an unmatched data set Strongest consumer recognition with further accretive growth
accompanying scalable economic benefits
5
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Committed to Sustainable Growth
Environmental Social Governance
A Low Impact Company A People Focus Integral to operational, financial, and
reputational resilience
Light footprint I Energy, carbon, water, and waste Diverse team I 53% people of color and 69% female Significant board refreshment I Added 7 new
intensities 91% lower than other property types on trustees over 2 years, increasing diversity and
average High-integrity culture I Built on accountability, reducing average tenure to approximately 5 years
entrepreneurship, employee development, diversity,
Proactive initiatives I Focus on further reducing and inclusion New executive compensation plan I Well-aligned
our impact and generating ROIC through initiatives with our strategy of creating sustainable long-term
including LED lighting, solar power, and low water Training and development I Over 367,000 training value though a multi-year and multi-metric approach
use landscaping across the portfolio hours in 2020
Enhanced communication I Committed to deeper
Low obsolescence I Properties retain physical and Career Advancement I Recently created three new and more frequent communication with investors
functional usefulness over decades positions for our property and customer care center and analysts
employees
High structural resilience I Designed and built to
Enterprise Risk Management I Focused on
mitigate the impact of climate and natural disasters Health, Safety, and Wellbeing I Comprehensive
operational risk, cyber security, and data privacy
benefits and programs provided to nearly all
employees, including part-time
Highest ethical standards I Foundational structure
PS Cares Emergency Fund I Established to for oversight and accountability, promoting fairness
and compliance, and proactively managing risk
provide additional incentive pay, childcare
assistance, extended paid time off, and mental
wellness support during the pandemic
6
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Attractive Income Growth Profile
Public Storage’s income generation outpaces the broader real estate space
Same-Store Net Operating Income Growth
Indexed to 2010
Cumulative: +82%
CAGR: 5.7%
Public Cumulative: +34%
Storage CAGR: 2.7%
Core Real Estate
Sector Average1
2011 2013 2015 2017 2019 3Q 2021 YTD
Source: Company filings
1. Core real estate sector average includes apartment, industrial, office, and retail REITs. 7
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Delivering the Digital Customer Experience
Digital transformation enhances the customer experience while also enabling our operating model transformation
Finding a Space Lease Execution / Account Management / Daily Property Use
Website Digital Rental Remote Comprehensive Digital Property Access2
Agreement Customer Care Mobile App
Industry-Leading Platform Leading Adoption by Customers Development Complete and Highest Customer Utilization Enabling Customer Access and
Enables Operating Efficiency on Location in Several Markets and Satisfaction (out of 5)1 Data on Property Utilization
Mobile centric
~50% ~28% Full leasing, account management,
4.6 stars 2.3 stars First company to
and customer care functionality
Click-to-call and AI-enabled chat
of move-ins of move-ins 21,000 reviews 130 reviews 100% of properties
Public Storage Peer Average Live video interaction with Public Storage Peer Average
Public Storage
Dynamic pricing across channels customer care representatives
Full leasing, account management, Electronic locks in testing to
customer care, and digital property complement building access
24 million visitors per year
access functionality
Source: Company disclosure and data, Apple, Google
1. Based on Apple and Android reviews as of November 2021.
2. Digital property access systems provide hands-free digital access through parking gates, doors, and elevators via the PS App. 8
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Strengthening Our Operating Advantage
First-mover technology implementation and operating model transformation are further enhancing our profitability
Same-Store NOI Margin1
Further margin expansion through operating
78.4% model transformation and sustainability initiatives over
the next few years, including:
74.4%
72.8% 25%
Payroll cost savings through
customer experience optimization2
69.8%
69.0%
30%
Utility cost savings through solar
Public Extra Space National Storage CubeSmart Life Storage power and LED light implementation2
Storage Storage Affiliates
Source: Company filings
1. Nine months ended 9/30/21. National Storage Affiliates margin benefits from the inclusion of tenant insurance.
2. Savings in hours for on-site property manager payroll and supervisory payroll from specialization and technology enablement compared to 2019 levels. Please see 2021 Investor Day presentation for further detail. 9
Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Accelerated External Growth
Executing as higher-quality, better-priced acquisitions come to market and robust fundamentals support property development
Growth Since Beginning of 2019 Total Owned Portfolio By Property Type1
198 million square feet
$7.1 billion Non-Same Store
Lease-Up Properties:
of investment in acquisitions,
development, and redevelopment
Acquisitions
15%
Stabilized
36 million Same Store
Properties
square feet added to the portfolio 75% 5% Development
5%
22% Redevelopment
increase in portfolio size
High growth lease-up properties are now 25% of the total portfolio and growing
Source: Company filings
1. Includes acquisition properties closed or under contract subsequent to 9/30/21. 10Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Advantages and Unique Capabilities Drive Growth
Differentiated Acquisition Strategy Portfolio Expansion (2019 – 2021 YTD)1
Infuses Proprietary Big Data and Analytics Square feet added, millions
Deep analytics underpin investment decisions made by our experienced team 40
35
Enhances Benefits of Diversification and Coverage
Unique operating upside is fully captured within markets and across the portfolio 30
25
Generates Industry-Leading Income Performance
Platform advantages drive NOI in lease-up and seasoned properties acquired 20
15
Unlocks Redevelopment and Expansion Opportunities
Only REIT in-house development team identifies and executes on additive growth 10
5
Achieves Superior Returns
Retained cash flow and debt funding complement our operating outperformance
0 Public
Storage
National
Storage Affiliates
CubeSmart Extra Space
Storage
LifeStorage
Reputation as a preferred property acquirer with no contingencies,
execution certainty, and speed to close on a cash basis
Source: Company filings
1. Includes acquisitions announced subsequent to respective 3Q21 earnings releases. 11Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Significant Income Growth & Value Creation
Historically strong acquisition and development performance with embedded earnings upside
Considerable future earnings growth through occupancy and rent lease-up
3Q21 Acquisition Yields1 3Q21 Development Yields1
Yield in 2020 Yield in 2021 Yield in 2020 Yield in 2021
10.6%
8.0%
7.5% 7.4%
7.1%
6.0%
5.6%
4.8% 4.8% 4.7%
4.1%
3.7%
1.5% 1.8%
0.9%
(1.1%)
Year Acquired: 2021 2020 2019 Year Delivered: 2021 2020 2019 2018 2017 2016
Occupancy / Growth2: 90% (+13%) 94% (+3%) Occupancy / Growth2: 90% (+184%) 90% (+6%) 91% (+4%) 92% (+3%) 93% (+1%)
Rent Growth3: 8% 31% Rent Growth2: 69% 58% 35% 27% 24%
Source: Company filings
1. Annualized NOI yield on cost to acquire or develop (including land). Pro rata adjustments made for properties that were not owned or operational for the entirety of the annualized time period. See 3Q 2021 earnings Supplement for detail.
2. Average occupancy for three months ended 9/30/21. Numbers in parenthesis are increases relative to the comparable prior-year period.
3. Three months ended 9/30/21 relative to the comparable prior-year period. 12Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Balance Sheet Positioned to Fund Additional Growth
Capacity remains following balance sheet evolution towards utilizing debt to fund external growth
Net Debt and Preferred Equity on Balance Sheet1 (billions)
Debt and free cash flow fund significant external growth
$5.8
• $7.6 billion of debt issued at a 1.7% blended rate
$1.5
$1.0 $1.8
Debt — USD
Debt — EUR $4.1 $4.1 $4.1
Preferred Equity
Preferred equity has been refinanced at lower rates
• $5.7 billion of preferred equity refinanced since 2015
2015 2020 Today
• Blended rate reduced by more than 130 bps to 4.5%
% Debt 7% 42% 65%
Cost of Debt and
5.6% 3.9% 2.7%
Preferred Equity
Net Debt + Preferred
2.5x 3.2x 3.9x
Debt capacity to fund additional growth along
Equity to EBITDA2 with annual retained cash flow
Long-Term Target = 4.0x - 5.0x
Source: Company filings
1. Proforma for the $1.5 billion All Storage acquisition, $1.75 billion debt issuance, and preferred equity issuance and redemption activity announced subsequent to 3Q21 quarter end.
2. Current figure based on 3Q21 EBITDA annualized and proforma for the above referenced transactions.
13Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Attractive Valuation
Multiple upside to historical premium valuation
Quality and Growth 2022 FFO Multiple1
30x
Strong geographic mix with the most owned and “A” locations
25x
Margin-expanding operating model transformation underway
20x
15x
Industry-leading external growth with unique development platform
10x
25% of square footage now in the high-growth non same-store pool 5x
0x EXR NSA PSA LSI CUBE
Balance sheet positioned to fund growth plans
Source: Wall Street consensus estimates per Bloomberg
1. As of 1/4/22. 14Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Public Storage is…
Strengthening our wide-ranging competitive advantages
Transforming our operating model through customer experience, employee
satisfaction, and margin expanding digitalization
Enhancing our industry-leading portfolio quality
Accelerating external growth with significant embedded future earnings upside
Achieving superior returns on invested capital through industry-best operations and
a growth-oriented balance sheet
Uniquely positioned for continued industry leadership, innovation, and growth
15Appendix
16
16Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Same Store Move-In and Move-Out Update
Revenue Gained from Move-Ins Revenue Lost from Move-Outs
Move-In Rates Move-In Volume Move-In Contract Revenue Gained Move-Out Volume Move-Out Rates Move-Out Contract Lost
40%
40% 25.0%
20% 10.4% 12.1%
20% 8.5% 9.8% 9.5%
1.0%
0% 0%
-8.9%
-20% -20%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Move-Ins Fourth Quarter Move-Outs Fourth Quarter
2021 2020 Δ 2021 2020 Δ
Average annual contract rent $17.60 $14.78 19.1% Average annual contract rent $18.59 $15.74 18.1%
Square footage 22,325 24,287 (8.1%) Square footage 23,673 24,937 (5.1%)
Contract rents gained $98,230 $89,740 9.5% Contract rents lost $110,020 $98,127 12.1%
Source: Company filings
17Industry Leader I Organic Growth I External Growth I Balance Sheet I Attractive Valuation and Outlook I Operating Update
Same Store Occupancy and Rent Trends
Square Foot Occupancy at Period End Annual Contract Rent Per Square Foot at Period End
2020 2021 2020 2021
$20.02
$19.56
95.7%
94.6% 94.2% 94.8%
$17.67 $17.90
At September 30 (Q3) At December 31 At September 30 (Q3) At December 31
Growth: +120 bps +60 bps Growth: +10.7% +11.8% bps
Source: Company filings
18Non-GAAP Reconciliations
Net Income to EBITDA Reconciliation
3Q2021
2015 2020 Annualized
Net income $1,318 $1,361 $1,968
Net operating income attributed to noncontrolling interests (8) (6) (8)
Depreciation and amortization 425 553 756
Interest expense 1 56 96
Extraordinary and nonrecurring gains and losses (19) 96 (164)
PS Business Parks and Shurgard equity earnings (48) (80) (132)
Distributions received from PS Business Parks and Shurgard 33 97 101
EBITDA $1,702 $2,077 $2,617
Source: Company filings
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